Walmart’s click and collect pickup solution in the USA

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Walmart‘s big announcement

In 2015, Walmart announced a new omnichannel strategy designed to drive sales growth by strengthening its e-commerce businesses. The main motivator was to get ahead of the e-commerce giant and market disruptor Amazon who is changing the retail landscape all over the world.

The plan

Enhance the omnichannel experience in stores

Optimize supply chain capabilities to lower costs

Build deep digital relationships with customers

As part of the new omnichannel strategy, Walmart looked at click and collect technology providers.

The goal was to find a BOPIS (buy online pickup in store) solution. The solution would ensure smooth and easy customer’s journey from online order to store pick-up. Walmart selected Cleveron 401 (aka Pickup Tower) solution for a pilot program in 2016. After a successful trial, Walmart decided to add the Cleveron 401 in stores across USA. By the end of 2019, there will be around 1600 Pickup Towers installed in the States. Walmart has also installed the Pickup Towers in a few of their shops in Canada.

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The click and collect challenges

Walmart’s new omnichannel strategy involved implementing a click and collect solution which would fulfill their vision of engaging consumers and to help save customer’s time and money. Growing e-commerce and parcel volumes presented several challenges that effective click and collect solution would help to solve.

Reduces in-store labor costs – manual click and collect pickup is a labor-intensive service and the costs are increasing with the parcel volume.

Solving the last mile delivery

With click and collect technologies, Walmart can remove the last mile delivery costs by leveraging its fleet of more than 6,700 trucks to deliver products directly from fulfillment centers to its 4,700 stores. This means significant savings on transport costs.

These savings are shared to the customer, continuing its legacy of driving value and cost savings to its customers while providing the ease and convenience.

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The click and collect solution

Cleveron 401 (aka Pickup Tower)

Standing at approximately 16 feet (5 meters) tall and 8 feet (2,5 meters) wide, Walmart has positioned Cleveron 401 pack robots (aka Pickup Tower) at the front of stores, close to checkout. Walmart's customers simply choose from millions of items available on Walmart.com and select the “Pickup” option at checkout.

When the item arrives at the local store, an associate loads it into the Pickup Tower, which, for Walmart, holds up to 300 small to medium sized packages. The customer will receive notification via Walmart’s smartphone app or email. When the customer arrives at the store, they step up to the Pickup Tower and scan the barcode sent to their smartphone. They receive their order in less than a minute.

Cleveron 402

Walmart is also using Cleveron’s newest solution, Cleveron 402. It is also an automated in-store click and collect pickup self-service solution but is extendable and can hold from 226 up to 1400 parcels simultaneously.

The click and collect results

According to Forbes, on the battlefield of click and collect pickup, Walmart has a huge advantage over Amazon and Cleveron’s pack robots are playing an essential role in shifting the advantage into Walmart’s favor.

In Walmart’s omnichannel strategy, the Pickup Towers provide an automated click and collect self-service pickup solution. It helps customers save time and money through fast and easy pickup experience.

After the successful pilot, Walmart announced that the Pickup Tower program would be expanded to other locations across the country. By the end of 2019, there will be around 1600 Pickup Towers installed, making the fast pickup option available to more than half of the U.S. population. Every Pickup Tower will come with adjacent Pickup Lockers (on the picture), making it possible also to collect larger items.

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Substantial savings on costs

Automated click and collect pickup solution
Cleveron 401
is 80% more effective than any manual click and collect pickup service.

Cleveron 401
holds up to 500 items but has only 5,4 m² footprint

Automated self-service pickup reduces parcel handling costs

In-store click and collect pickup reduces last mile delivery costs

Increased customer experience

Mark Ibbotson, the executive vice president of Central Operations for Walmart U.S., said at the 2018 Shoptalk conference that the NPS score of the stores with Pickup Towers grew 500 basis points. The NPS score is used as a proxy for gauging the customer’s overall satisfaction with a company’s product or service and the customer’s loyalty to the brand.

In the race with Amazon

90% of Americans live within 10 miles of a Walmart store, and they serve more than 140 million customers a week. By launching additional omnichannel initiatives aimed at blending its physical and digital channels, Walmart can better leverage its massive brick-and-mortar footprint to compete with Amazon.

Cost savings found through click and collect solutions have also helped Walmart to develop discount programs, like Pickup Discounts, to combat Amazon’s Prime membership model.

Increased foot traffic and sales

In-store click and collect pickup converts online traffic to in-store visits. Mark Ibbotson, executive vice president of Central Operations for Walmart U.S. said at the 2018 Shoptalk conference that stores with
Cleveron 401
(aka Pickup Towers) experienced an increase in in-store sales.

A study on consumer buying trends in 2017 holiday shopping season also showed that 40% of shoppers used click and collect and 90% of them bought additional items once in the store.

More e-commerce revenue

In April 2018, Walmart announced Pickup Discount, a price reduction on eligible, online-only (non-store) items that customers buy online and ship to any Walmart store for pick up (advantage of BOPIS).

Walmart is also predicted strong e-commerce growth of 40% for 2018.

End-customer feedback

Initial feedback about the Walmart Pickup Tower experience has been very positive, with many consumers shocked at the speed of product pickup and ease of use.

One millennial shopper noted: “I think it’s a great idea for the fast life we’ve evolved to”. A Business Insider reporter tested the Pickup Tower and said: “Upon retrieving our items, we left the store. It was the easiest and most convenient Walmart experience we’ve ever had.”

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Hardware

Walmart has implemented Cleveron 401 as well as 402 to automate click and collect pickup

Software

Walmart has a custom-made user interface and we have built-up integration with their backend systems

Maintenance

Remote monitoring by Cleveron, remote maintenance and on-site maintenance by Bell and Howell

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„One of my personal favorites is our Pickup Tower. Much like a high-tech vending machine for your online orders, this feature in a few of our stores allows you to pick up items in less than a minute by scanning a barcode sent to your smartphone. The pilot phase has been so successful we’re expanding it to other locations across the country.“

Mark Ibbotson

Executive Vice President of Central Operations for Walmart U.S

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